WorldCC Things That Matter Webinar 2: Going Deeper

On 30th May 2024, as part of WorldCC‘s Thought Leadership webinar series, Stephen Bruce talked further on our concept of ‘Things That Matter’ – in particular how the process works in practice, by operationalizing empathy at the organizational level.

The webinar looked at “How to head off or overcome relationship issues by identifying and measuring what matters most” and this led to some excellent questions and comments from attendees.

Most of these were expertly handled by Sally, but Stephen expanded upon some here:

“Isn’t it funny that we would take so much time to understand “things that matter” in our personal relationships and not apply remotely the same attention in trading relationships?”

That’s certainly how it looks!

And in some cases, that’s probably actively the case, due to any or all of the following reasons:

  • A sense that that’s what the contracting process is for (“if it’s not in the contract, then it can’t matter that much”).
  • An assumption that it’s “obvious” – that it always boils down to price in the end and/or that “all suppliers/customers are pretty much the same”.
  • A more “old-school” and combative approach to relationships, where asserting your own needs is the way to get things done.
  • As discussed in the webinar, how we’ve become used to favoring the left side of our brains at the exclusion of the “softer”, bigger picture right side.

Spending time thinking what matters to the other party then seems like a bit of a waste of time.

But, as discussed later in the webinar, in perhaps the majority of cases, it feels like the will is there – a genuine desire for empathy – but that some combination of the following means that that willingness rarely translates into focused effort on really understanding the other party:

  • It’s a nice to have when “busyness” is overwhelming.
  • It can be hard work, without any immediate or direct “pay-off”.
  • A lack of knowing how to do it at an organizational level.

That last reason seems particularly crucial to us – in other words, the challenge is to find a way of doing this that’s natural, that harnesses the goodwill and insights of as many people as possible, and that yields swift benefits.

Hopefully the webinar demonstrated a way forward that does all three.

“Would you agree that it’s the customer that needs to choose the relationship and drive this, or would you say it’s equally applicable to a supplier to identify a customer with which they want to work on this?”

The approach presented in the webinar is entirely neutral in terms of who “starts” it.

Starting it is sometimes a joint decision – where both parties recognize the combination of (i) the value of the relationship, and (ii) the challenges they want to do better with – but usually it’s one of the parties that takes the initiative.

There’s then often a perception that the customer is the one that mostly “holds the cards”: that they’re more likely to be able to hold sway over the supplier, and more likely to resist an approach made to them than the other way round.

And it has to be acknowledged that whilst there will be times that such approaches may not work – regardless of who makes them – the customer often does have something of a “casting vote”.

However, it’s pretty marginal. Suppliers often have the “upper hand” and, in the video clip during the webinar, we heard from an Operational Relations Manager on the supplier side, and it was the supplier that largely pushed for the programme and ran with its findings.

In general terms, though, the relationship needs to be of significant value to both parties, and ideally roughly aligned in terms of any segmentation (e.g. a top supplier from the customer perspective; a key customer from the supplier perspective).

The process generally begins with getting your own “house in order” with what matters, and that often starts by looking at what’s not working, which is a great foundation for then opening up conversations and advocating for a new approach:

  • “Did you know that we consider the following to be serious issues?“
  • “Did you know that we’re all agreed that these are problems?“
  • “We’ve identified these issues in our relationship and think it’s costing you $x“
  • etc

At that point, you may well grab attention – which could begin with curiosity (“really?! we have no idea! I wonder what we think…“) – and the door may be more open than you think.

Can every supplier attract the attention of every customer they’d ideally want a better relationship with?

No.

But the same’s true in reverse.

It’s ultimately about finding a relationship of sufficient mutual value and creating a context that points clearly to the need for doing something different.

“It is interesting that when we carry out a new procurement we rarely try to understand the direction, goals, priorities, and values of the perspective contractor. It is invariably historical information.”

Similar comments apply here as for above (about not taking the same time to understand the Things That Matter in commercial relationships as in personal ones), but this possibly adds in an aspect of “we’re the customer – are you going to give us what we want or not?”.

In terms of historical information, it probably reflects not yet having realized or accepted the pace of change now – it’s assumed that either the contractor in question hasn’t changed since last time, or that the conditions surrounding the contract being let haven’t changed… or at least not in any way that makes a significant difference.

But of course change is now beyond rapid, and part of the dynamics of Complexity is that small deviations can have major impacts.

There will continue to be those that resist facing all this, but the curve we looked at doesn’t lie – this just isn’t sustainable.

“Many would challenge the role of empathy in a command and control organisation”

Totally agreed: where the approach taken is to force through a preconceived set of priorities and practices – whether due to genuinely thinking that’s the best way to do things, or through a lack of an alternative – empathy will seem unnecessary, or even “weak”.

One chink in the armor here may be to remind skeptics that empathy can be presented as a way of overcoming an adversary – any sense that it’s “touchy-feely” is misguided.

Other than that, though, some combination of the following is likely the way to win over those unpersuaded or hostile to an approach that encourages “empathy”:

  • Using the curve we looked at to demonstrate that existing approaches (most of which are command and control) aren’t working.
  • Emphasizing empathy with the end customer as the initial focus, as this is pragmatic.
  • Starting small, e.g. with permission for a pilot (or forgiveness for one…!).
  • Showing the benefits that follow.

“What were the poll results?”

Poll 1: How are you currently finding out what matters to your relationship partners and counterparts (choose all that apply)?

- Contractual negotiations / documents: 66.67%
- Personal conversations: 80.56%
- Account meetings: 63.89%
- Customer / supplier survey: 41.67%
- External consultant research: 11.11%
- Industry reports: 36.11%
- Google / ChatGPT: 11.11%
- Something else: 8.33%
- None of the above: 0%

Poll 2: Which of the following are familiar experiences in your commercial relationships (choose all that apply)?

- Waning initial enthusiasm as reality bites: 51.11%
- Difficulties and problems rolling out the contract: 57.78%
- Relationship failure (early termination, etc): 20.00%
- Prolonged, unresolved issues: 62.22%
- Complex renegotiations to try and improve things: 51.11%
- Hard-won but mostly marginal success: 44.44%
- Fully realized expectations: 28.89%

This poll was in reference to the graphic explained in this article.

“This approach is key to developing successful SRM programmes with key contractors and partners. It has to be a two way process and encourage shared problem solving”

Absolutely, and there ideally needs to be proper consideration of the “R” in “SRM”.

Far too often in our opinion, what’s billed as Supplier Relationship Management doesn’t really have any relationship component to it.

As mentioned in the webinar, surveys – a common tool used in the “SRM” space – absolutely have their place, but don’t try and pretend that they’re really about the relationship:

  • Surveys are nearly always primarily for the benefit of whoever’s running the survey.
  • Yes, what might go in an “SRM” survey might indicate some of what you care about, and some general improvements might be made that hopefully benefit (at least some) suppliers.
  • However, it’s not really a communication “with” suppliers – almost entirely “from” them – and there isn’t anything specific going “back” to each supplier.

In our experience, suppliers are crying out to be heard by their customers, and it’s not so they can tell their customers what they think – they really want to know what their customers think, expect and value, and for that to have at least a degree of being specific to the specific relationship they have with you: the Things That Matter (to coin a phrase…!).

And at that point, yes, it absolutely needs to be two-way and mutual – ideally with effort made to align those Things That Matter and progress them in shared dialogue.

Is the full process appropriate with all suppliers? No.

Is it possible with all suppliers? No.

Can you use the principles of the process with all suppliers, though? Can you involve two-way exchange, and measure and manage what matters, regardless of what “tier” of suppleir they are? Yes and yes!

Contact Stephen to follow up anything else from the webinar.

A full version of Stephen’s slides – including speaker notes – can also be downloaded here.

More resources: